Who was Petr Kellner? Four things to know about the sudden death of the richest Czechs
He scraped through the void of post-communist Czechoslovakia in the early 1990s with photocopiers and office supplies. He rose to the wealthy heights of the Czech business world, becoming the country’s richest businessman, media mogul, shy philanthropist and government whisperer.
Petr Kellner, who died this weekend in a helicopter crash on a ski trip to Alaska, was both admired and feared, as his company PPF Group grew into a financial giant with stakes ranging from insurance to real estate to telecommunications, from Central Europe to China and beyond.
Bloomberg valued his fortune at $ 15.7 billion, Forbes at $ 17.5 billion.
US officials say, at the moment, that there is nothing to suggest anything other than an accident – possibly human error, perhaps mechanical issues. Federal aviation officials and state police are still investigating. Four other people, including the pilot, also died in the incident.
Kellner’s death reverberated in the Czech Republic, where reporting dominated news broadcasts and top newspaper websites all day on March 29, and much of central Europe.
Here’s a look at who Kellner was.
Trained in economics, Kellner, 56, cut his teeth in capitalism after the 1989 Velvet Revolution that ended communism in the country. His official biography says that for several years he worked as an office supplies salesperson, including importing and servicing photocopiers.
He also raised enough financial capital and business connections to set up an investment fund to invest in state assets privatized by the post-communist government through a “stock voucher” program. .
The Prvni Privatizacni Fond (PPF) became its main investment vehicle, buying stocks and shares in more than 200 companies, then acquiring a 20% stake in the country’s largest insurer, Ceska Pojistovna.
PPF propelled Kellner into an asset-buying frenzy not only in the Czech Republic and Slovakia, after the break-up of Czechoslovakia, but in other countries of Central and Eastern Europe. The holdings of the PPF group have grown to include biotechnology, media distribution, real estate, banking and consumer credit. The group is a major player in the Russian mortgage industry and has also invested in the booming agriculture and agricultural industry in Russia.
A 2007 deal between Ceska Pojistovna and Italian Generali created an insurance giant for Central and Eastern Europe, further adding to Kellner’s fortune when he left the partnership in 2012 for $ 2.5 billion. ‘euros ($ 2.03 billion).
The PPF Group’s telecommunications holdings include a majority stake in O2’s cell phone and internet operations in the Czech Republic in 2014. In 2018, the company closed on a € 2.8 billion buyout of telecom assets (US $ 2.28 billion) from Norwegian company Telenor located in Hungary, Bulgaria, Montenegro and Serbia.
But it was his holdings in media and television companies that not only generated profits, but also came under scrutiny. In 2004, PPF Group restructured the largest national Czech television channel, TV Nova, and then sold it to Central European Media Enterprises, a US-based holding company known as CME. Kellner then joined the company’s board of directors.
Over the next decade, CME bought – and sold – media and distribution companies in Romania. And in 2019, the PPF group said it buy out the other shareholders in CME – including US media giant Time Warner – to become the sole owner of CME, a deal valued at $ 2.1 billion.
The company’s media activities now span more than five European countries, with more than 30 TV channels, which PPF estimates reach over 45 million viewers. The company also owns four radio stations in Bulgaria.
The purchase of CME by the Kellner group, and the wider trend of independent media groups to be bought out or controlled by powerful business interests, prompted a Czech media watch group to issue a public warning.
“The last few years have shown that the situation where the biggest entrepreneurs and their groups buy the country’s most influential media outlets fundamentally undermines confidence in their independence and puts pressure on journalists themselves,” the Endowment Fund for the independent journalism. said in 2019. “Petr Kellner’s latest transaction continues on this path.”
A Czech in China
One of his first investments was one of the main profit drivers of the PPF group: the consumer credit division, Home Credit.
In the late 1990s, Kellner used mortgage loans to buy out banks in the Czech Republic and Slovakia, then spread to Russia, where he quickly gained a dominant position, focusing on home loans. quick and easy consumption.
Two years after first testing water in China, Home Credit in 2010 became the first licensed foreign consumer lender, tapping into the country’s economic growth and Chinese consumers’ appetites for everything from mortgages to easy retail loans on things like cellphones, cars or personal computers. The strategy has paid off, making Home Credit a major source of value for the PPF Group as a whole.
According to a 2019 report by Czech online news site Aktualne.cz, Home Credit has loaned around CZK 300 billion ($ 13 billion) to China since entering the market.
The Home Credit Rush in China hitting major obstacles on the road in late 2019 and 2020, when the country and consumers entered lockdown, amid government efforts to curb the COVID-19 pandemic.
Back home, the Chinese investments of the PPF group are reflected in Kellner’s support for closer Czech ties with China. He accompanied President Milos Zeman on business trips to China, which sparked controversy in some Czech political circles.
In 2019, Aktualne.cz reported that Home Credit had secretly hired a public relations firm to boost China’s image within the Czech Republic.
The company and Kellner have been battered by criticism from liberal Czech lawmakers, who support Taiwan’s fighting with Beijing and oppose China’s authoritarian communism. Home Credit officials later said the campaign’s aim was simply to “weaken extreme positions in the public sphere” on business and life in China.
The future of PPF
The most prominent political figures of the Czech Republic, including Zeman and Prime Minister Andrej Babis, publicly cried the news of Kellner’s death.
Investors and analysts have meanwhile debated what Kellner’s death would mean for the future of the PPF group, in which he held 99% of the shares.
Home Credit had planned to go public via a first public offering in Hong Kong, plans that were already on hold due to the pandemic. The PPF group indicated earlier this year that it is looking to consolidate some of its European banking operations and its digital banking start-up Air Bank.
Among those who analysts say are candidates for the leadership of the PPF group include Jean-Pascal Duvieusart, CEO of Home Credit and, along with Ladislav Bartonicek, the other holder of outstanding shares not held by Kellner.
In a statement, the PPF group, which now has its official headquarters in the Netherlands, expressed its “deepest sorrow” at the death of its founder.
“Her professional life was known for her incredible work ethic and creativity, but her private life belonged to her family,” the company said.
Kellner was well known for his refusal of publicity and gave few media interviews over the years. He and his family had a well-known philanthropic foundation which donated millions of dollars for Czech educational causes.
In the company’s latest annual report, Kellner offered his own musings on his business and the year before, when the Czech Republic and the rest of the world were hit by the COVID-19 pandemic.
“We know that every crisis is also an opportunity, and that problems are there to be faced and solved. Life is what we make of it. What our work brings to others. The real, tangible results we can see behind tell us what is to come, ”he said in the 2019 report.